In fact, when it comes to business tax, we are now dead last among developed nations. We pay the highest tax of any nation in the world. Our rate is the least competitive rate there is. Our business tax rate is 60 percent higher than our average economic competitor. Think of that.

And then you say, "How do you compete?" Well, in many cases, you don't. Our companies leave. They go to other countries.

It's a massive tax on every product made in America, giving countries like Germany, Canada, Japan, South Korea, China and Mexico, not to mention so many others, a massive head start over American industry.

It is time to go from dead last to pretty much the front of the pack. Pretty much.

(APPLAUSE)

We won't be the lowest, but we'll be getting pretty close.

Under our framework, we will dramatically cut the business tax rate, so that American companies and workers can beat our foreign competitors.

(APPLAUSE)

We will cut the business tax rate from 35 percent all the way down to 20 percent; below our average competition by far.

And this is a revolutionary change. And the biggest winners will be everyday working families, as jobs start pouring into our country.

(APPLAUSE)

When companies leave our shores, it's American workers who get hurt. They get fired. When companies stay in America and move to America, it's our wonderful workers who reap the benefits and the rewards.

And for the majority of American manufacturers, that file taxes as sole proprietors or S-corporations or partnerships, we will cap your tax rate at a maximum rate, unlike present, of 25 percent. That's your maximum rate.

(APPLAUSE)

TRUMP: This will be the lowest top marginal income tax rate for small and medium-sized businesses in more than 80 years. The lowest in 80 years.

(APPLAUSE)

And it will be rocket fuel for our economy.

To further help our companies to compete, for the next five years, our framework will allow you to fully write off the cost of new equipment in the year you buy it. Think of that one. To me, that's so big.

(APPLAUSE)

So you don't take it over many years, you take it immediately upon when you buy it. That will be something that people have never seen before. And it will be great. It will be truly great. That means more production, more investment and far more jobs.

If we want to make more products that say "Made in America" -- because that's what we want, "Made in the USA" or "Made in America" -- then we have to reduce taxes on the businesses that produce in America. And with your help, that is exactly what we are going to do.

Fourth and finally, our framework -- and you have to remember -- you see what's happening with companies and offshore -- encourages American companies to bring back trillions of dollars in wealth parked overseas.

[12:05:00] Our current tax code actually punishes companies for keeping their headquarters in America and discourages them from bringing back the profits they earn overseas. We are going to reverse that.

Right now, we have at least $3 trillion overseas. And I must tell you, I've been following this for six years, and Republicans and Democrats have always said, "We want that money to come back." So they all agree, and they still never got it done. We're going to bring everybody together, and we're going to get that done. (APPLAUSE)

We will eliminate the penalty on bringing back future earnings and bringing them back to the United States in full. And we will impose a one-time low tax on money currently parked overseas, so it can be brought back home to America where it belongs.

For too long, our tax code has incentivized companies to leave our country in search of lower tax rates. My administration rejects the offshoring model, and we have embraced a new model. It's called the American model.

We want companies to hire and grow in America, to raise wages for American workers and to help rebuild American cities and towns. When we grow American manufacturing, we don't only grow our jobs and wages, but also grow America's spirit. When we purchase products made in America, fashioned by our fellow citizens, we renew the bonds of national loyalty that link us all together as one.

There is a great patriotism that lives inside the men and women who leave their hearts on the factory floors, who pour their hopes into the works of iron and steel, and who turn dreams into reality with their own two hands.

TRUMP: When they huddle in the break room, at the rest stop, or at the end of a long and very tiring shift, they take pride in knowing that the products they work and the products they make aren't just building business. They're building families and communities. And most of all, they are building this nation that we all love so much.

(APPLAUSE)

We want every American to know the dignity of work, the pride -- the pride, the beautiful pride -- getting a paycheck, the satisfaction of being told, "That was a job well done." We want every parent to be able to care for their children. And we want every child to know a home filled with love and a community filled with hope.

That is the America we see when we look at our American flag that hangs in all of our factories, sails our oceans and waves over our cities, towns and fields. We love our American flag.

(APPLAUSE)

The soul of a country is found in the people who make it a home. And we owe it to our citizens to provide them with a future of opportunity where they can earn a living with dignity and purpose and pride.

We can build this future together as one team, one people and one great American family. This can be remembered as the moment we took control of our destiny and chose a future of American patriotism, prosperity and pride.

With your help and your voice, we will bring back our jobs, we will bring back our wealth, and for every citizen across this land, we will bring back our great American Dream. Thank you.

You're watching the president of the United States here in Washington, a lengthy address to the National Association of Manufacturers. The president's main goal today, promote his big tax reform plan. The president says it will create millions of jobs, help bring money offshore, that companies have moved offshore, back to the United States. That's the president's main focus.

But he began this speech by speaking for four minutes about the federal response to Hurricane Maria and its devastating impact on the island of Puerto Rico. The White House under some fire, some criticism in recent days that the aid is not getting to Puerto Rico as quickly as many residents desperately need. We'll bring you more of what the president said in just a moment.

But let's get straight to Puerto Rico. CNN's Boris Sanchez is on the ground.

We lost Boris Sanchez, I'm told, in San Juan.

All right, well, let's have a conversation here. With us to share their reporting and their insights, Abby Phillip of "The Washington Post," Carl Hulse of "The New York Times," Jonathan Martin of "The New York Times" and Karoun Demirjian of "The Washington Post."

We were joking before, the ladies of "The Post" versus the men of "The Times." My money's on the ladies.

JONATHAN MARTIN, "THE NEW YORK TIMES": Ouch.

KING: Let's talk -- we'll bring you -- we're turning around some of the sound the president just spoke there. His acting Homeland Security secretary, who is working 24-7 on this, let's be clear about that, said something quite stupid. She said that this was a good news story. What she says she meant now, she has cleaned this up a little bit, she has cleaned this up a little bit in saying what she meant was that people are working 24-7. People on the ground, the aid organizations, neighbors helping neighbors. That's what she meant.

The mayor of San Juan took offense to that. So the administration is in a bit of a political dilemma, if you will.

Listen to the president at the top of his remarks.

(BEGIN VIDEO CLIP) DONALD TRUMP, PRESIDENT OF THE UNITED STATES: All appropriate departments of our government, from Homeland Security to Defense, are engaged fully in the disaster and the response and recovery effort probably has never been seen for something like this. This is an island surrounded by water, big water, ocean water. We're closely coordinated with the territorial and local govern which are totally and unfortunately unable to handle this catastrophic crisis on their own. Just totally unable to. The police and truck drivers are very substantially gone.

(END VIDEO CLIP)

KING: That's the president's take there. And he's, number one, saying to local govern, the island govern, the national government, if you will of Puerto Rico, the governor and mayor, is not capable of handling this crisis.

This is a political challenge for the president right now and especially because of not so much about what they've done, but what they've said. I think it is hard to get the aid there. It is a second hurricane to hit. But when you have the president saying everything is fine, when you have the acting secretary of Homeland Security saying this is a good news story, at a minimum, at a minimum they seem tone deaf.

ABBY PHILLIP, "THE WASHINGTON POST": I think they've also been really focused on the media coverage, partly because they know that that's what President Trump is very sensitive to.

One of the things -- in addition to the good news story talking point you heard, Tom Bossert, the homeland security official, basically talking about how, oh, he wants the media to show more update pictures of what's going on, on the ground. They're very sensitive to what this looks like.

MARTIN: Yes.

PHILLIP: And that's important too. But they should also be sensitive to what the reality is on the ground. I mean these images wouldn't be there if people weren't desperate for water and desperate for food and desperate for shelter and gas.

You know, I think this administration is facing a rally difficult challenge. This is not Texas or Louisiana where you have a fairly strong state govern that can take the lead and can work hand in hand with the federal government. They needed to be a little bit more proactive and didn't realize that until it was probably too late.

KING: Right. Let's bring in -- we had a transition issue at the top of the program. Let's get straight to San Juan. CNN's Boris Sanchez, among our many correspondents on the ground.

Boris, the president says he's doing everything he can and he's prepared to do whatever it takes. Just tell us, what's the situation for the people there who are trying to recover from all this devastation? BORIS SANCHEZ, CNN CORRESPONDENT: Hey, John.

Yes, people here are continuously asking us where they can find aid. They certainly aren't feeling that help from the federal government here. Case in point, we've been standing at this gas station all morning. We arrived here at about 5:00 a.m. And there was an immense line. The line is still huge, hours long. People camped out here overnight.

The guy that was in the front of the line this morning, I got a chance to speak with him and he told me that he showed up at 9:00 p.m. The gas station ran out of gas. So he said he parked his car, turned it off and went to sleep waiting until sunrise when the police finally got here to help facilitate spreading out gas.

There's also people here with canisters. Look over here to the left. Some people bringing 10, 11 canisters to fill to take to their homes and power their generators. But I've seen people use just about anything they can, from old laundry detergent canisters, to paint canisters, water jugs, anything that will get them gas to their homes.

And it's not just gas that's the issue. We also have heard from several people that have spent hours in line at grocery stores only to get in and find out shelves are bare. I spoke to one woman who told me she was heartbroken after she couldn't find any water after having waited outside a grocery store for several hours.

[12:15:15] So getting supplies has certainly been an issue. And there's a big problem on the horizon, John. More rain is headed to this area. And there's a severe danger for flooding.

Yesterday we were in a neighborhood that has a channel running through it that floods just about any time there's a rain storm. During Hurricane Maria, sewage started flowing into people's homes and a lot of those people had to leave, in part because their roofs were blown off. So there's a lot of people that are on the street right now.

(INAUDIBLE).

KING: You see we're having some transmission issues there. It's tough to get a live satellite signal out of San Juan, Puerto Rico.

Boris Sanchez, appreciate the reporting.

Let's come back into the conversation here because what has happened in the last 24 hours reminds me a lot of what happened in Katrina in the sense that you have a -- you have a mayor in -- just in San Juan, there are other municipalities as well, but you have a mayor who hears good news and she's getting questions for her people, why didn't you have water for us?

You have the governor, who's a Democrat, progressive party, a Democrat, who has said, I think the president's all in on this. We're just -- we just need more. We just need more. He's not criticizing the president, he's just saying, you know, I think the president's heart's in the right place, I think they're trying to help us, but we need it now, we need it faster.

And Marco Rubio says, you know what, the president should federalize this, at least temporarily, by putting a general in charge to clear the roads, to get the trucks in, to get the supplies going. And Bush faced that decision. That was one of his hesitations at the beginning of Katrina, whether to overrule the governor essentially and take it over.

Where do we go?

KAROUN DEMIRJIAN, "THE WASHINGTON POST": And that's a big -- it's a -- it's an optics question. It's also, you know, does he have the trust that he's going to be the more competent authority, be able to handle this question? I think we've established at this point that things aren't going well if you don't have more engagement from the federal level, but it's taken as long as it's taken and now things are that much worse.

This is a situation where, you know, distribution is also a problem, right? You can send everything up to the edge of the island. If you can't get it to the people who need it, what's the point? And, not what's the point, but it doesn't actually do the job that you need it to do. And you're getting to the point where it's, as you said, people waiting in line trying to get water. I mean that's an existential situation.

And if you're going to make a decision to federalize something, to put a three-star in to actually run the show, as much as it's difficult to make that judgment call and as politically challenging, you want to do it early before it gets to this situation, because then you're in this situation and it's that much more of a mess.

KING: Well, you hear the voices of Congress recommending that. The acting secretary of Homeland Security, Elaine Duke, is on the ground in Puerto Rico. He'll be holding a press conference in San Juan next hour. We'll bring you this when it happens. One would assume that if the recommendation is going to come for the federal government to escalate, it would come from her.

We'll take a quick break. INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

[12:21:55] (BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: At the very center of that plan is a giant, beautiful, massive, the biggest ever in our country, tax cut.

(END VIDEO CLIP)

KING: President Trump, just a few moments ago, describing, as only he can, the centerpiece he says of the new Trump administration and Republican congressional tax plan.

A quick reminder, they're beginning to sell this plan now. It's a tough sell in Congress. It's tough sell in the country.

Here are some of the basics. Collapse the number of tax brackets from seven down to three, 12, 25, and 35 percent are the targets. It would double the standard deduction. Would call for a big expansion in the child tax credit and it eliminates the estate tax and the Alternative Minimum Tax. And for those businesses, the president was just speaking to, this is the big selling points, cuts the corporate tax rate from 35 percent to 20 percent.

We're in the beginning of the sales pitch. The question is, there are a lot of land mines for this one. We went through this in Obamacare. Republicans have philosophical differences, regional differences and the like.

The early prognosis is what?

CARL HULSE, "THE NEW YORK TIMES": It's do-or-die for the Republicans on the tax plan.

KING: If Republicans can't pass a tax cut --

HULSE: This is -- this is all they've got right now and they really have to get it through. I don't think they have any choice. They are going to have to find a way to pass this because if they don't, they're going to be an abysmal failure. And they know that. So they're going to push this all sorts of ways.

Republican like to cut taxes. So they should be able to come together on a plan. But you're right, I mean there's a lot of landmines and it's not going to be easy and it will probably go into next year.

MARTIN: It's one of those --

KING: You think it will -- hold on one second.

MARTIN: Sure.

KING: You spent a lot of time on Capitol Hill. You just spoke -- those are magical words for how this works in terms of the accomplishments. So this -- you think it will go into next year? So the --

HULSE: I -- it's going to take a while (ph).

KING: The Republican president of the United States and the all- Republican Congress are going to go an entire year without repealing and replacing Obamacare and without passing a tax cut?

HULSE: I think it's going to -- I think it's going to take some time. But I do think they have absolutely no choice whatsoever than to pass this (ph).

MARTIN: They could pass a DACA fix, which is, of course, got a huge (INAUDIBLE) base, as you know, John.

DEMIRJIAN: They have until March on that. They don't have to (ph). MARTIN: No, all seriousness, there is a -- in this era of the Republican Party, this coalition, there's not a lot of unifying issue. But one of them sure as heck is cutting taxes. And if you layer on top of that the urgency that Carl is talking about to have an accomplishment going into the mid-terms to sort of rally their base. I do think that this will happen. It is going to be that what you just showed there on the screen? Maybe not. But there's going to be some tax cut I think signed into law next year.

KING: Is it hard when you know the Republican establishment has problem with its own base. We're going to talk more about this as we go through the program. But the Republican establishment has problem with its own base. The president is trying to sell this to his voters, especially the blue collar Trump voters, as a good thing for you. And it will create jobs. Yes, it will cut business taxes, but they will then create jobs. It's also going to cut middle class taxes, the president keeps saying, except listen to his chief economic adviser saying, I think so.

(BEGIN VIDEO CLIP)

GEORGE STEPHANOPOULOS, ABC NEWS: If I'm hearing you correctly, you can't guarantee that no middle class families will get a tax increase. There will be middle class families who get a tax increase under your plan, correct?

COHN: Now, look, I can't guarantee anything. You can always find a unique family somewhere.

(END VIDEO CLIP)

KING: Have -- if we did not learn from the Obamacare debacle that when you're trying to sell something, you better have a compelling communications strategy. What was that?

PHILLIP: Yes, I mean, look, that's one of the many landmines ahead for this tax plan. What does it do for middle class families? I mean compare -- especially compared to if it's a tax cut for corporations and for high income earners. I think they have to actually make that true in order to -- for Trump to sell it to his voters who are not millionaires necessary. Not all of them are millionaires.

And beyond that, there's also the question of, does it add to the deficit? And if so, by how much? You know, and the president is not even totally sold on his own tax plan. You know, I was told earlier this week that he's still resisting this idea of 20 percent. He's talking about it, but he's resisting it because he wants it to be 15. He wants to say that he brought it down by half or more than half.

So we're -- we have a long way to go here and we know that the president doesn't always -- just because his aides and The Hill have endorsed something, doesn't mean that he's all the way there. And he -- often in the past has undermined his own efforts on things like this (ph).

KING: And, again, I don't want to overdue the Obamacare comparison, but you were on The Hill throughout this. You have some northeast, more moderate Republican, state and local income tax deduction would disappear. About 35 votes in the House of Representatives. If you take that away, people from Maryland, people from New York and New Jersey. New York and New Jersey especially where you have some Republican congressional people. Then you have, on the other hand, to Abby's point, what would this do to the deficit, because they have not described how they will pay for this.

And as you come in, listen to the Treasury secretary. We just had Gary Cohn, the president's chief economic adviser, saying, I can't promise you every middle class family gets a tax cut. Now, this is the Treasury secretary, the other chief salesman for the Trump White House. This is for the deficit hawks.

(BEGIN VIDEO CLIP)

STEVE MNUCHIN, TREASURY SECRETARY: We think there will be $2 trillion of growth. So we think this tax plan will cut down the deficit by $1 trillion. That's a large number.

(END VIDEO CLIP)

KING: Abracadabra alakazam.

DEMIRJIAN: Yes. I mean the deficit thing -- we've been fighting about the White House's math about the deficit and the growth contribution. It's philosophical at this point. We've been talking about that since they first said tax reform, right?

So it's not their numbers that are going to carry the day. This has to be scored once they actually have a bill. Does it actually do what they say it's going to do? It's very existentially important for them to actually be able to make good on that though because if this -- what is it, if it adds to the deficit beyond 10 years out, you can't use budget reconciliation, and then that means that you're going to need to have Democrat on board. And then the whole thing goes kaplooyi (ph), right?

So the -- and a lot of this will depend on, so are their numbers actually adding up? And then, as you made the point before, there's a lot of senators that are going to maybe say, wait a second, this might actually be a tax hike. You not only have the removal of state and local tax deductions, you have the personal exemption that's gone. That's already, for a lot of middle class families, well over $10,000. And, yes, you're doubling the standard, but will it make up for everything else, you know, depending on what else they take away.

And so this is kind of the puzzle. And to Abby's point before, the one reason that I am not willing to say, you know, oh, well, it's going to be really, really hard for them to get it through is that a lot of Americans do not understand their taxes. You know, I'm a (INAUDIBLE) who sits there with pen and paper every year and tries to do it by hand because I just want to understand what is fitting together, but it's really confusing. So a lot of people --

KING: (INAUDIBLE)?

DEMIRJIAN: What? Well, I mean -- well, anyway, but it's really confusing and a lot of people will pass that off to like, you know, TruboTax or an accountant. And so if you tell them the top line numbers are nice and if you pitch this correctly, you can get -- convince a lot of people who don't necessarily know how to look into the guts of their own taxes and say, wait a second, wait a second, these numbers aren't adding up in the way that actually (INAUDIBLE).

MARTIN: Well, and the (INAUDIBLE) respond too. If you pass that corporate tax rate cut, the market is going to -- is going to, I think, really take off, at least in the short term, right?.

DEMIRJIAN: But is the market, you know, the best thing for the Trump- based voter? And will they even know that themselves because --

MARTIN: (INAUDIBLE). Yes.

DEMIRJIAN: Well, not all of them.

KING: That Ross Perot guy say, the devil's in the details. Is that where that came from?

Everybody sit tight. We're at the beginning of this conversation.

But it does matter to you. It does get arcane sometimes too. There's a lot of math involved. But we'll keep on top of this.

Up next, something much easier to understand. The president's still angry with his cabinet secretary, Tom Price, about flying private on your dime. Price doesn't seem too worried about getting fired.